The Malawi Human Rights Defenders Coalition (HRDC) has joined other stakeholders in condemning government’s new vehicle import duty.
A statement signed by HRDC National chairperson Gift Trapence said the new import duty has imposed unrealistic and punitive taxes on the citizens, hindering economic growth and impeding the rights of individuals to engage in economic activities.
“It is imperative that HRDC makes its positions clear to ensure that there is tax justice in the country that can foster conducive environment for the economic welfare of Malawians.
“We, at HRDC, believes that no country can develop without citizens being responsible for paying taxes and we acknowledge the importance of taxation for national development and support formulation of laws and implementation of measures for citizens to fulfil their tax obligations.
“However, paying taxes should not be penutive to the citizens or stifle the growth of businesses. Taxes must be fair and reasonable, allowing citizens and enterprises to thrive and contribute to the country’s economic progress. The imposition of punitive taxes restricts the rights of citizens to engage in economic activities and inhibits the growth of businesses,” reads the statement dated July 4, 2023.
Trapence said tax administration should be fair, reflecting the reality of the country’s economy and the enjoyment of economic rights by the citizenry.
“Taxes should be designed in a manner that considers the economic situation and the ability of individuals to pay, ensuring a just distribution of the tax burden.Malawians are already burdened with excessive taxation. Our citizens are among the most heavily taxed individuals in the world.
“The introduction of additional unrealistic taxes on vehicle importation exacerbates the financial strain on the populace, leading to further economic hardships.HRDC believes that taxes, when used effectively, can be instrumental in uplifting the impoverished. Rather than imposing punitive taxes, we advocate for realistic taxes that create an environment conducive to improving the welfare of citizens and facilitating their transition out of abject poverty.
“The outcry against the taxed levied on imported vehicles is justifiable. The government must reevaluate the formula used to determine these taxes, as it fails to reflect the actual market value of imported vehicles. Under the new calculation regime, the taxes imposed far exceed the cost of the car itself.
“The current tax regime is inhibiting citizens from importing and owning vehicles, due to the prohibitive tax structure. This severely limits mobility and economic opportunities for ordinary Malawians, hindering their ability to engage in productive activities
Trapence said the timing of the tax increase, during a period of economic hardship for the masses, displays the insensitivity of the government towards the suffering of ordinary Malawians.
HRDC has given the government a 7-day ultimatum to engage with different stakeholders and address this issue, If it fails to do so, after the said 7 days, they will tell Malawians the next course of action.
